Live Export

Elders says live export losses could total $7.3m

Beef Central, 06/07/2011

Elders expects to lose up to $7.3m as a direct result of the Federal Government’s suspension of live exports to Indonesia.

In a profit warning issued today Elders said preliminary accounts for June 2011 showed a direct impact of $1m for the month through lost earnings by Elders’ live export and Indonesian operations. It also highlighted a $500,000 reduction in network earnings for the month through flow on effects on northern Australian trading and the impact of lower prices on earnings from livestock across Australia.

The announcement said further impacts were expected in coming months.

While these will be subject to a range of “indeterminate variables” relating to the duration of the suspension and livestock price movements, Elders said it anticipates the impact over the three months to financial year end to total between $2.9m and $5.8m.

“This figure includes anticipated network flow on impacts of an estimated $2.2m to $4m with the principal contributor being lower livestock earnings,” the statement said.

Other non-network costs were projected to include shipping, legal and other costs brought by the suspension. 

Some items are anticipated to be categorised as non-recurring.

In total, and based on assumptions yet to be tested and verified, the impact of the suspension was projected to be approximately $4.4 million – $7.3 million, the announcement said.

Elders said it would continue update the market on ongoing impacts in keeping with its continuous disclosure requirements.

Shares in Elders fell 0.5c on the news to 39c.

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